Wednesday, March 14, 2012
Friday, March 9, 2012
The Parliamentary standing committee on finance has recommended an exemption of Rs 3.2 lakh (excluding home loans), instead of Rs 2.7 lakh (including home loans) at present.
NEW DELHI:
The Parliamentary standing committee on finance, in its final report
on Friday, suggested reworking the income tax slabs, seeking exemption for
income up to Rs 3 lakh and wanting the highest tax rate of 30% to kick in at over
Rs 20 lakh. To make the tax system more predictable, the panel
recommended that the slabs be indexed to inflation.
The report, which will help the government push the Direct Taxes
Code, has also suggested that the exemption limit for savings be
enhanced from Rs 1 lakh to Rs 1.5 lakh.
It suggested that the exemption limit for life and health insurance, and
education, be doubled to Rs 1 lakh and a separate deduction of Rs 50,000 be
permitted for higher education.
For purchasing medical insurance for elderly parents and grandparents, an
additional exemption of Rs 20,000 should be given, although it is silent on
housing loan exemption which is currently at Rs 1.5 lakh.
The committee has recommended an exemption of Rs 3.2 lakh (excluding
home loans), instead of Rs 2.7 lakh (including home loans) at present. If the
parliamentary panel's prescriptions find favour with the government, those with
annual income of up to Rs 6.2 lakh will stay outside the tax net. Further
concessions for women and senior citizens in the tax slabs have also been
recommended in the report.
The panel has suggested that the senior citizen cut-off age be lowered to 60 years,
instead of 65.
The slabs suggested by the panel are far more liberal than those suggested in the
DTC Bill although it is lower than what was proposed in the draft Bill in 2009.
In the Bill introduced in August, 2010, the government had suggested that
income up to Rs 2 lakh be outside the tax ambit, a 10% levy was proposed for
annual income of Rs 2 lakh-Rs 5 lakh, 20% for Rs 5 lakh-Rs 10 lakh, while
above Rs 10 lakh, the 30% rate was to be applicable.
There is no relief for companies that the panel headed by former FM Yashwant
Sinha has suggested that corporation tax rate be retained at 30%, instead of
25% proposed in the draft Bill. There is also a suggestion to dispense with STT
and raise the wealth tax exemption limit from Rs 30 lakh to Rs 5 crore. tnn
While the DTC Bill is pending in Parliament, the new law is unlikely to be
in place by April when the next financial year begins. As a result, the proposed
slabs, if accepted by the government and endorsed by the legislature, will
only be applicable from April 2013.
The panel is also not in favour of annual tinkering in tax slabs. Instead it has
suggested that it should be indexed to inflation. "The committee notes that
almost every year, the exemption limit is being tinkered with, albeit marginally.
This, however, does not have any linkage with the price index or the
growing inflationary trend. The committee would, therefore, desire that
there should be a built-in mechanism embedded in the statute itself based on
consumer price indices, whereby the tax slabs would be automatically and
periodically adjusted for inflation," the 360-page report said.
The committee argued that moderate tax rates would "induce better tax
compliance with a view to giving some relief to the small tax payers." In
addition, it said that compliance and transaction cost will come down, helping
the income tax department "focus their attention and re-orient their resources
on the higher income groups, untaxed or concealed incomes, and categories
and sectors that are avoidance or evasion prone." By increasing the cut off
to Rs 3 lakh, over 2.5 crore of the 3.3 crore tax payers would go out of the tax
net. Government data suggests that 89% of the taxpayers are up to Rs 5
lakh bracket with collections estimated at around Rs 11,000 crore.
The Parliamentary standing committee on finance, in its final report
on Friday, suggested reworking the income tax slabs, seeking exemption for
income up to Rs 3 lakh and wanting the highest tax rate of 30% to kick in at over
Rs 20 lakh. To make the tax system more predictable, the panel
recommended that the slabs be indexed to inflation.
The report, which will help the government push the Direct Taxes
Code, has also suggested that the exemption limit for savings be
enhanced from Rs 1 lakh to Rs 1.5 lakh.
It suggested that the exemption limit for life and health insurance, and
education, be doubled to Rs 1 lakh and a separate deduction of Rs 50,000 be
permitted for higher education.
For purchasing medical insurance for elderly parents and grandparents, an
additional exemption of Rs 20,000 should be given, although it is silent on
housing loan exemption which is currently at Rs 1.5 lakh.
The committee has recommended an exemption of Rs 3.2 lakh (excluding
home loans), instead of Rs 2.7 lakh (including home loans) at present. If the
parliamentary panel's prescriptions find favour with the government, those with
annual income of up to Rs 6.2 lakh will stay outside the tax net. Further
concessions for women and senior citizens in the tax slabs have also been
recommended in the report.
The panel has suggested that the senior citizen cut-off age be lowered to 60 years,
instead of 65.
The slabs suggested by the panel are far more liberal than those suggested in the
DTC Bill although it is lower than what was proposed in the draft Bill in 2009.
In the Bill introduced in August, 2010, the government had suggested that
income up to Rs 2 lakh be outside the tax ambit, a 10% levy was proposed for
annual income of Rs 2 lakh-Rs 5 lakh, 20% for Rs 5 lakh-Rs 10 lakh, while
above Rs 10 lakh, the 30% rate was to be applicable.
There is no relief for companies that the panel headed by former FM Yashwant
Sinha has suggested that corporation tax rate be retained at 30%, instead of
25% proposed in the draft Bill. There is also a suggestion to dispense with STT
and raise the wealth tax exemption limit from Rs 30 lakh to Rs 5 crore. tnn
While the DTC Bill is pending in Parliament, the new law is unlikely to be
in place by April when the next financial year begins. As a result, the proposed
slabs, if accepted by the government and endorsed by the legislature, will
only be applicable from April 2013.
The panel is also not in favour of annual tinkering in tax slabs. Instead it has
suggested that it should be indexed to inflation. "The committee notes that
almost every year, the exemption limit is being tinkered with, albeit marginally.
This, however, does not have any linkage with the price index or the
growing inflationary trend. The committee would, therefore, desire that
there should be a built-in mechanism embedded in the statute itself based on
consumer price indices, whereby the tax slabs would be automatically and
periodically adjusted for inflation," the 360-page report said.
The committee argued that moderate tax rates would "induce better tax
compliance with a view to giving some relief to the small tax payers." In
addition, it said that compliance and transaction cost will come down, helping
the income tax department "focus their attention and re-orient their resources
on the higher income groups, untaxed or concealed incomes, and categories
and sectors that are avoidance or evasion prone." By increasing the cut off
to Rs 3 lakh, over 2.5 crore of the 3.3 crore tax payers would go out of the tax
net. Government data suggests that 89% of the taxpayers are up to Rs 5
lakh bracket with collections estimated at around Rs 11,000 crore.
Sunday, March 4, 2012
India in talks with Switzerland to bring home tax on undeclared money
After sealing a double taxation avoidance pact with Switzerland, India is now negotiating with the Alpine nation for an arrangement to obtain tax on undeclared money parked in Swiss banks. Under the agreement, the identity of the citizens would not be disclosed. However, the arrangement is likely to be different from the one entered into by Switzerland with the UK and Germany. Switzerland had earlier drawn up treaties with Germany and the UK that entails turning in tax from undeclared assets which the citizens of the nations keep in its secretive banks. In fact, Greece was also reportedly working on a similar arrangement with Switzerland. India is also keen to seal a similar deal but with different terms and conditions. As per the current contours of the agreement, tax is collected by Switzerland on the interest earned by citizens on the deposits. In return, Switzerland asks for market access for its financial institutions and a resolution of the problem ofpurchasing illegally acquired tax data. However, given the fact that the interest paid by Swiss banks is very low, the amount generated in form of tax is inconsequential. The average interest rate in Switzerland, decided by the Swiss National Bank, was 1.52 per cent from 2000 until 2010. India, therefore, wants that the tax collected by Switzerland should be on the deposits and not just the interest earned. Further, India can't provide greater access as demanded because it is already in negotiations with the European Union for a free trade agreement and till its conclusion, any such decision is unlikely to be taken
How Smartphones Got Cheap
How Smartphones Got Cheap
2002 - Nokia launches the first Symbian smartphone is India: the 7650 at Rs 36,000 approximately.
2004 - Research In Motion enters India with BlackBerry 7730 BlackBerry 7230 and BlackBerry 6230. Their price range is Rs 18,000-32,000.
2009 - Post-paid plans for BlackBerry Internet Services average Rs 1,200 a month. High recurrent costs prevents penetration of handsets in India. HTC and Bharti Airtel bring the first Android phone to India: HTC Magic, priced at Rs 29,990. BlackBerry launches Curve 8520 at Rs 14,990. market perception about the brand shifts from a "senior management" only phone.
2010 - Acer beTouch E110 ushers in the era of sub Rs 10,000 Android phones. A huge hit among the urban and rural customers. Micromax launches Andro A 60 for Rs 6,900. Indian manufacturers enter the high-end market by buying off-the-shelf designs from Chinese manufacturers.
2011 - Idea launches 3G smartphone, the cheapest Android-powered phone for Rs 5,850. Bundles with 3G services, claims the effective price is Rs 2,609. BlackBerry slashes price of Curve to Rs 9,990. Students buy smartphones to "BBM" friends.
2012 - BlackBerry Go BBM plan now available for Rs 129 a month. Pre-paid users can access the plan for just Rs 5 a day. Spice Mobility slashes price of Android Froyo-based Mi-270 smartphone to Rs 3,399 setting a new benchmark for cheap smartphones in India.
The Future Trick
Lower the cost of the most expensive components: Processor, Display/LCD Panels, Memory, Camera, Software, Phone Case
In-Stat, a global research and analysis firm, says component prices of smartphones dropped dramatically in 2010. This was possible largely due to integration of GPS, Bluetooth, Wi-Fi and sometimes FM radio onto a single chip.
It predicts that by 2015, Android will ship 339 million smartphones under $150.
Gartner claims that by 2015, 67% of all open OS devices will have an average selling price of $300 or below.
A Short History of How the Phone Got Smart
A Short History of How the Phone Got Smart
Full name reads IBM Simon Personal Communicator, the world's first smart phone. (No, it wasn't a BlackBerry after all) Simon is a mobile phone, pager, fax machine and PDA rolled into one. Wondering about apps? Check out the features list: calendar, address book, world clock, calculator, note pad, e-mail, and games.
1996 - Nokia Communicator:
And the full QWERTY keyboard comes to the phone. It flips open like a wide pencil box (called clamshell design), runs on GEOS V3.0 operating system and allows text-based web browsing. Follow ups: Nokia 9110 and Nokia 9110i.
1997 - GS88:
Much like the Communicator series, the Ericsson device finds a place in history mostly because of the brochure writers: the first time a company calls such stuff "smartphones"
1999 - Kyocera VP-210:
The world's first phone with a built-in camera comes from Japan, a company called Kyrocera. It is meant for face-to-face communication so the lens is on the front of the camera. You can't see the click button if you focus it on anything but yourself.
2000 - Symbian & Ericsson T36
The hardware of the device, Ericsson's R380, isn't much to talk about. But it is the first phone loaded with Symbian, the operating system that rules the smartphone world for years to come. Another key innovation: compact and small design. It puts in an in-built Bluetooth and every smartphone worth its money has to have one.
2001 - Kyocera 6035:
The first smart phone to be used widely in the US. The 6035 combines a PDA and a wireless phone services and runs on the Verizon Wireless network.
2002 - BlackBerry 5810:
Research in Motion finally gets it right. Two-way pagers give way to a convergent device with the all important push email: one click and all your office communication is at your finger tips. Big hit with senior management world wide.
2007 - iPhone & Android
First multi-touch smartphone that changes the category altogether. Sleek design with a single home button, users type into the screen. The mysteriously-captioned OS X is a huge hit. A Linux-based operating system Google bought in 2005 comes out with the first Android-phone: HTC Dream. The open-source system eventually powers Samsung, Motorola, LG and other brands. Biggest threat to iOS. Five years on, daily activations hit 5 million.
2008 - App Store
And phones change forever. Third-party apps make smart phones more versatile than ever imagined. Apple launches software development kits to help developers embed free and paid apps on the iOS.
2011 - Nokia Lumia
Nokia and Windows alliance produces the first smartphone: Lumia 710, and 800 powered by the Windows Phone OS. Fails to become game changer in smartphone market.
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